Lease terms can fasten non-agricultural assessment liability directly on a lessee despite the general land revenue rule.

A lessee of land held by a development authority was not treated as a government lessee merely because the land was leased through a public body; the land was not shown to be government land and the authority was not acting as the State's agent, so liability for non-agricultural assessment remained. The lease regulations and deed expressly required the lessee to pay land revenue, taxes and cesses, so the revenue authorities could directly demand the assessment from the lessee notwithstanding the general rule that the occupant is primarily liable under the land revenue code. The challenge to the demand failed, though objection to quantum was left open.

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Issues: (i) Whether the appellant was a government lessee and therefore not liable to pay non-agricultural assessment. (ii) Whether, as tenant of the Development Authority, the demand for non-agricultural assessment could be made directly against the appellant.

Issue (i): Whether the appellant was a government lessee and therefore not liable to pay non-agricultural assessment.

Analysis: A government lessee under the Maharashtra Land Revenue Code, 1966 is a lessee holding land directly under a grant by the Collector in respect of government land. The leased land in question was held by the Development Authority, which is a body corporate empowered under the Maharashtra Regional and Town Planning Act, 1966 to acquire, hold, manage and dispose of land in its own name. The land was not shown to be government land, nor was the Development Authority shown to be acting as an agent of the State Government for this lease. A circular relied upon by the appellant concerning MIDC leases did not apply to the Development Authority and could not alter the statutory position.

Conclusion: The appellant was not a government lessee and remained liable to non-agricultural assessment.

Issue (ii): Whether, as tenant of the Development Authority, the demand for non-agricultural assessment could be made directly against the appellant.

Analysis: Although the occupant is ordinarily primarily liable for land revenue under the Maharashtra Land Revenue Code, 1966, the Development Authority's disposal regulations specifically required the lessee to pay rates, taxes, land revenue and cesses on the demised land, and the lease deed repeated that obligation. In that setting, the statutory liability to bear the assessment stood fastened on the appellant, and direct demand by the Revenue authorities was justified. Section 168 of the Code was not treated as barring direct demand where the lessee's liability arose from the governing regulations and lease terms.

Conclusion: The demand could validly be made directly against the appellant.

Final Conclusion: The challenge to the demand failed, the High Court's view was upheld, and the appeal was dismissed with liberty to the appellant to raise objections as to quantum before the revenue authority.

Ratio Decidendi: Where statutory regulations governing a lease specifically fasten liability for land revenue or non-agricultural assessment on the lessee, the State may directly demand such dues from the lessee notwithstanding that the occupant is ordinarily primarily liable under the land revenue code.

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